KUALA LUMPUR (April 26): The two executives charged by Swiss authorities on Tuesday (April 25) over their involvement in the 1Malaysia Development Bhd (1MDB) fraud are likely to have been PetroSaudi International executives Tarek Obaid and Patrick Mahony.
The two men were the principal players who conspired with financier Low Taek Jho (Jho Low) to steal US$1.8 billion from 1MDB via a joint venture (JV) with PetroSaudi that started in 2009 and was initially only US$1 billion. Between 2010 and 2011, another US$800 million was put in by 1MDB into various fraudulent schemes with PetroSaudi.
Much of the money was exposed in 2015 by The Edge and Sarawak Report to have gone to Obaid, Mahony and the infamous Good Star bank account at RBS Coutts in Zurich that belonged to Jho Low.
The exposé was facilitated by documents given by ex-PetroSaudi executive Xavier Justo.
According to a Bloomberg report on Tuesday, the pair, who were not named by Swiss prosecutors as is the practice there until trial starts, were accused of having used the facade of a JV and US$2.7 billion in assets “which in reality it did not possess” to lure US$1 billion in financing from 1MDB, according to Swiss prosecutors. The two opened Swiss bank accounts to receive the money, and then used the proceeds to acquire luxury properties in London and Switzerland, as well as jewellery and funds “to maintain a lavish lifestyle”, the prosecutors said.
The allegations cover a period at least from 2009 to 2015, and the duo have been indicted for commercial fraud, aggravated criminal mismanagement and aggravated money laundering. An indictment usually means the case proceeds to trial at Switzerland’s Federal Criminal Court.
Although the 1MDB-PetroSaudi JV was the first of several fraudulent schemes initiated by Jho Low, those involved are the last to be indicted. In the last few years, Goldman Sachs and former executives like Tim Leissner and Roger Ng have been convicted for large scale theft of billions of dollars that took place between 2012 and 2013. Former prime minister Datuk Seri Najib Razak has also been convicted and jailed for one case, with a few other cases still in court.
Jho Low himself is wanted by Malaysia, Singapore and the US but is believed to be hiding in China.
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